DUBAI, July 28 (Reuters) - Egypt's bourse fell on Sunday but
the main reason was a tumble in the shares of heavyweight
Orascom Construction Industries, not the deaths of
dozens of supporters of ousted president Mohamed Mursi.

Cairo's index opened higher but then retreated to
close 0.7 percent lower in thin turnover. Last week it hit a
two-month high after rallying 20 percent since late June because
of hopes for better economic management under Mursi's successor.

Security forces shot dead dozens of people at the weekend,
and there was potential for more bloodshed as thousands more
Mursi supporters continued to protest on the streets. But
analysts and traders said many investors were willing to accept
such violence as long as they thought it would not derail
Egypt's transition to civilian rule in coming months.

"People are optimistic the army got rid of the fascist
regime," said Amr Reda, assistant vice-president for the foreign
sales desk at Pharos Securities.

"The violence was expected and the main driver is the stress
from the army they will go ahead with the set roadmap," he
added, referring to the military's transition plan, which aims
to hold parliamentary elections within about six months.

The factor which pulled the market down on Sunday was a
slide in Orascom, the most heavily weighted stock, which fell
5.0 percent to 238.50 Egyptian pounds as a tender offer for its
shares by Dutch-listed affiliate OCI NV expired.

During the tender period, priced at 255 pounds, investors
had been buying Orascom to make a profit by selling into the
offer, but that incentive disappeared on Sunday.

Foreign investors were net buyers on Sunday, exchange data
showed.

KUWAIT ELECTIONS

In Kuwait, the index edged up 0.2 percent, rising
for a ninth consecutive session to its highest closing level
since June 3.

Sentiment was positive after liberals and candidates from
some of the country's more marginalised tribes won seats in
Saturday's parliamentary elections. Many Islamists and populists
boycotted the polls, so investors are optimistic that the new
parliament will adopt a cooperative approach to the cabinet,
permitting progress on long-delayed economic development plans.

In Dubai, builder Arabtec dropped 3.1 percent to
2.18 dirhams per share after the firm issued 1.56 billion new
shares well below its market price.

The new shares, which started trading on Sunday, were issued
at 1.50 dirhams each. The firm said in early July that its 2.4
billion dirham ($653 million) rights issue was nearly 30 percent
oversubscribed.

Dubai's index slipped 0.5 percent, down for a
second session in the last three from Tuesday's near five-year
peak. Abu Dhabi's benchmark declined 0.6 percent, easing
off a 57-month high.

"The market will go into a sideways trend now that most
earnings are out," said Mohammed Ali Yasin, managing director of
Abu Dhabi Financial Services. "Investors will wait for the next
catalyst, which could be in November - the result of Dubai's
Expo 2020 bid."

Elsewhere, Qatar's index shed 0.4 percent, also
coming off a 58-month high as investors booked profits.